Hi, I'm really sorry I've failed to find a fix for this but I have been searching through the site for various mods for a day now and even searching specifically for this error, I couldn't fix this myself.

I've tried making my own avatars to go into the menu. I did a test one at first on chocobo and it worked fine so I made a set and thought it would all go smoothly from there. However the only avatars which are actually changing are young cloud and chocobo, the rest are the original avatars. I've deleted the cache folder (Square Soft, Inc\Final Fantasy VII\cache yeah?) as I saw others have been instructed for avatar problems but that hasn't updated them. I've double checked the menu_us.lgp as well to make sure the new avatars are indeed there.

I'm not sure why only two are working.

I'm using the menu overhaul M003 but that won't interfere I think, especially since two are working fine.

Ahh thank you! You pointed me towards my problem. I didn't properly nosey around in the DK folders before now so I never noticed that's where the PNG versions of the avatars are. They were overwriting the .tex versions I put in the regular menu_us.lgp. It's fixed now!